In the autumn of 2004, about six months after the death of my horse’s ass initiative, and about six months before I would start blogging, my fellow activist Steve Zemke somehow managed to arrange a meeting for us with House Speaker Frank Chopp and then House Finance Committee chair, now State Treasurer, Jim McIntire. Our purpose was to urge them to pursue some sort of progressive property tax reform in an effort to preempt Tim Eyman’s next initiative, but the conversation drifted broadly toward our structural revenue deficit, and thus inevitably, to an income tax.
Both Frank and Jim supported an income tax—in theory—but neither seemed too keen on raising the issue anytime soon. In fact, I clearly remember Jim warning me that any attempt to push an income tax prematurely could set our efforts back by a decade or more.
But Jim did put forth one scenario in which he could envision an income tax passing voters, a thesis I’ve since heard from other Olympia insiders, and which I’ve dubbed the “Phoenix Model.” Under this scenario, a brutal economic downturn combined with a decades-long erosion of our sales tax base could create a budget crisis so severe that legislators and voters would have no choice but to resort to an income tax, or… dramatically reduce the role and scope of Washington state government. Out of this budgetary Armageddon a new tax structure would be born, so the theory went, like the mythical phoenix rising from its own ashes.
So… um… aren’t we in that scenario now?
How much worse does the budget crisis have to get before voters and their elected officials accept that we cannot build a 21st century economy on the back of an early 20th century tax system? How many more hundreds of thousands of Washington citizens must be thrown off the health care rolls or denied a college education? How many businesses must flee our state or avoid starting up here due to the lack of an adequate transportation system or educated workforce or any number of other vital investments in public and human infrastructure?
How many billions of dollars must our budget be in a hole, and how many consecutive budgets must this hole be plugged through cruel cuts and regressive stopgap measures before the emergence of political leaders who are more concerned with long term solutions than with short term political gains?
In the Senate, I have been heartened by the leadership provided on this issue by Majority Leader Lisa Brown, and by the public support displayed by Senators Kohl-Wells, Regala, McDermott, Murray, Kline, and Fraser. Folks in the know suggest that should a high-earners income tax come to a vote in the Senate, Brown could likely corral enough support to put it on the fall ballot.
But from the House leadership, all we hear are crickets.
If House Finance Committee chair Ross Hunter (D-48) were to take the lead on a high-earners income tax he could rally support behind it and perhaps even push it to the floor for a vote. Yes, I know he’s focused on passing the education reforms on which he’s passionately dedicated himself for years, but few of these reforms are possible without the funding to back them up. And yes, I understand that he plans to run for King County Executive, but taking the lead on a high-earners income tax could be exactly what he needs to grab the edge with Seattle voters over Seattle liberals Larry Phillips and Dow Constantine.
But Hunter isn’t even technically a member of the House Democratic Leadership. So where’s Rep. Larry Springer (D-45) who represents an Eastside district where education funding routinely tops the list of voter concerns, or Rep. Zack Hudgins (D-11) a guy at least as comfortable palling around with DFH’s like me as he is with Olympia power brokers? Where’s my own representative, Majority Whip Sharon Tomiko Santos (D-37), a long time member of the Tax Fairness Coalition who represents citizens about as adversely effected by our regressive tax structure as any in the state, and who would suffer mightily under the proposed cuts?
For that matter, where the hell is our entire Seattle House delegation?
Yes, I know, I know, I know that Frank is as steeped in the conventional Olympia wisdom as the majority of the observers in the establishment press, and I know that he fears for his majority. And I know that Frank doesn’t really believe a high-earners income tax could pass voters, regardless of its surprisingly good showing in recent polls. But he can be nudged. He can be pushed. He could even be shoved.
Frank’s not a monolith. He is open to persuasion, and he does change his mind. But he’s clearly not going to take the lead on this issue on his own.
That’s why for those of you in the House who believe that an income tax is the only solution to our long term structural deficit, and who understand that after the federal stimulus monies disappear and a temporary sales tax increase expires, we’ll be right back where we started, even with an economic recovery—and I’m confident that covers the majority of the Democratic caucus—the only responsible thing to do is to stand up and take the lead on this issue now, while we actually have an opportunity to pass it.
Don’t wait for Frank! He’s way behind the electorate on this issue, and while I’m confident he’ll do the right thing and do it well once he’s brought up to speed, he’ll never get there unless some influential members of his caucus clear the way.
If a temporary sales tax increase was a sure thing at the polls, I’d understand your reluctance, considering the dire consequences should a revenue measure fail. But it isn’t. And in many ways, a high-earners income tax has considerably more political upside than any sales tax proposal.
So take a look at the recent the polling, and dive into the details. Talk to your constituents and listen to their concerns about further regressivity. And then somebody, anybody, please stand up and take the lead.
You’re absolutely right Goldy. We are in that exact scenario. I’m glad we’re FINALLY on the same page!
And we should use this opportunity to reduce the bloat of government, expect the public to buck up to do things they can do themselves, and for the smaller remainder provide critical services to those that can’t.
So, where do you recommend we start reducing?
Hmmm…that “smaller remainder” is getting bigger every day.
Matty @1,
Well, that is a debate–over the proper size and scope of government–that I would be happy to have. And I’m pretty confident that my side would win that debate.
But unless we actually have a conversation about the revenue side of the equation, we’ll never have that debate, and your side will just get its agenda by default as government purchasing power just gradually erodes away.
Yes, you are right of course, but too much of our Olympia legislative leadership is so wrought up in keeping their majority that they forget they are down there to DO SOMETHING with that majority.
To them, only the tiniest risk is worth taking. Sad, really, to miss the opportunity, the one they themselves identified not so many years ago.
And if, by some miracle, they were to acquire some…intestinal fortitude (to put it too politely) I would humbly suggest the “millionnaires tax” go down the income chart a little further, perhaps to Obama’s $250K earners (whom he wants to tax at an[increased] level equal to 10 percent less than what they paid under Ronald Reagan).
And just a tad higher than one percent; this new tax needs to raise enough revenue that we can not only meet basic revenue needs this biennium, but also dial back some of most hated state taxes. Point is, we don’t want this to look like merely a tax increase, but rather an effort at tax reform, at some tax shifting.
Leaving it a net tax increase just widens the target we put up there for the GOP (what there is left of it).
Your site is acting a little weird today, Goldy. I keep having to input my name and email address in order to post. When I refresh a page it keeps taking me back to the home page. The edit function has also disappeared.
I proctored a group of 3rd grade kids today as they worked really hard on their first WASL. I was really proud of them. But as I sat there thinking, I couldn’t help but wonder what difference it will make in the end how these kids do. Our schools are about ready to be gutted–huge class sizes, transportation drastically cut, special education cut, loss of custodial and maintenance help, book budgets ( and in some school districts, libraries and librarians) and techhology budgets eliminated, no on-site health personnel for sick and injured kids..you know, all those fancy extras that some say we can do without.
I have posted my list on here before of the things that I think should be taxed–homes over 1 million, cars over 75K, luxury boats, jewelry, RVs…things that are nice to have but are not essential in an economic downturn.
I also heard that if everyone picked 3 small businesses in their town and spent 50$ a month in each one, small business in America would reap several billion dollars a year. I dont know if it is true, but I do know small businesses can always use our help.
Democrats, listen to David. His perception of the voter is right-on. Do it.
Do it! Income tax now!
The timid march toward massive cuts while talking about taxes does nothing to impress the voters. Nothing. In fact we respect you less. Your democratic base is displeased. And displeased voters are indifferent voters next election. We’ll all be unemployed, so don’t count on donations either.
Once the stimulus dollars are gone, it will be the same angst-ridden wait for the final numbers.
There are a several things that will never recover from the cuts you’ve made without a restructure on the funding sources. K-12 education and higher education in particular.
The legislature has been less than generous with education even during flush times. For as big a “bargain” Washington higher education might be, it isn’t worth $40,000 of student loan debt.
Yes Goldy you are correct, Dramatically reduce the role and scope of Washington state government!
Lets start by not hiring the last 20 new job adds which are flying off of the State Listserver, at a rate of 10 per day.
No other business is hiring/ Why should State government be expanding at this rate?
Cut out retirement, medical, 401k’s, Unions, etc etc etc.
Let them see how WalMart workers feel!
Rome burns while Frank wanks.
Maybe we should PRAY for a state income tax? Might be more effective than insulting Susan Hutchison for the sermon she gave at the Governor’s Prayer Breakfast a few months ago. Might also be politically wise. I am sure there are more folks in this state who believe in prayer, than who believe in a state income tax. (And I bet I am not the only person in this state who believes in both!)
Just making a suggestion. But we do have to consider that Governor Gregoire was willing to give (Republican!) Susan Hutchison front and center to deliver a rather strident religious sermon, but won’t give the time of day to folks in her own party who support a state income tax.
@3,
I have a feeling it wouldn’t be a binary debate of “your” side and “my” side if it were deeper than a blog relationship. It would be more nuanced and deeper than that. Shhh….don’t tell anybody though. ;)
The total operating budget for the next biennium will be between 58 and 59 billion dollars. The legislature is poised to cut about 3.6 billion. If, without the cuts, the budget would have been about 62 billion, the cuts amount to less than 6 percent. The rest of the deficit is comprised of unmet expectations.
Is the sky really falling chicken little? Ya sure, you betcha.